Craig Erlam about UK inflation: It's expected to fall considerably this year, as per BoE forecasts, but as we've seen over the last 12 months, we live in unpredictable times
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It's definitely tough time for British pound which is trapped between Bank of England decision and the economic situation. We wonder what could a decent GDP print on Friday provide the pound sterling with. Let's hear from Oanda's Craig Erlam.
FXMAG.COM: After a 50bp rate hike, could promising GDP print provide further support for GBP?
Craig Erlam (Oanda): The UK is in a very tough position in that the economy is weak, rates are high and rising and inflation is still not far from its peak. It's expected to fall considerably this year, as per BoE forecasts, but as we've seen over the last 12 months, we live in unpredictable times. A better GDP print should provide support for GBP as it would indicate the economy is showing some resilience in the face of extremely challenging circumstances while not really being detrimental to the goal of getting inflation back to 2%.
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